Holdings of all forms of Chinese bonds held by offshore investors and cleared by China Central Depository and Clearing Co (CCDC) rose by 38.7 billion yuan ($5.89 billion) in September, to 896 billion yuan, according to Reuters calculations based data from the clearing house.

It was the largest increase in holdings by offshore investors since September 2016, and contrasted with a 1.7 trillion yuan decrease in overall Chinese bond holdings by all investors.

“Regulatory tightening forces domestic institutions to deleverage and stock up on cash. Currently, short-term rates are high, so repos are better investments than bonds,” said a Shanghai-based trader at an asset-management company, explaining why domestic investors had unloaded bonds in September.

Market observers have pointed to strong gains in the yuan, as well as high yields, to help explain offshore interest in Chinese bonds in recent months.

By early September, the yuan had gained 7.5 percent against the dollar year-to-date, but authorities allowed it to pull back a bit later in the month, possibly out of concerns that its rapid run-up could hurt exporters.

The rise in foreign holdings in September came despite the Chinese currency losing about 1 percent of its value against the U.S. dollar over the month, its weakest monthly performance in percentage terms since November 2016.

However, the attraction of China’s bond market increasingly outweighs “tactical” factors such as currency fluctuations, said Frederic Neumann, co-head of Asian Economics Research at HSBC in Hong Kong.

“Partly … because of low yields elsewhere in the world, Chinese yields look attractive. But also because China is too big to ignore as an asset market,” he said. “If you’re a big money manager, you need to take China’s bond market seriously.”

CCDC did not release a breakdown for September of foreign holdings by bond type, which it had done in previous months. Previous months’ data showed foreign holdings concentrated in government and policy-bank bonds.